200 suspected ecommerce companies under DIPP radar

ET Bureau|

Updated: Sep 02, 2016, 07.03 AM IST

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Nasscom has taken up the issue of increased fees for H-1B visas by $2,000 and L1 visas by $2,250 last year.

NEW DELHI: About 200 ecommerce companies, many of them suspected to be fake, have come under the radar of the Department of Industrial Policy and Promotion (DIPP) after the matter was referred to it by the Ministry of Consumer Affairs.

The department will coordinate with state governments and the ministry to get to the bottom of the issue, Commerce and Industry Minister Nirmala Sitharaman told reporters on Thursday. It was decided at a recent meeting between officials of the consumer affairs ministry, DIPP and NITI Aayog that all consumer complaints related to ecommerce companies would be addressed within two days through Twitter.

Sitharaman had asked the consumer affairs ministry to assign two officials to run a grievance redressal mechanism along with the commerce ministry for ecommerce-related queries. “Our department does not deal with consumer complaints. However, this issue is complicated as many of the companies in question seem non-existent…we will look into it together with the consumer affairs ministry,” Sitharaman said.

The minister did not share the names of the companies against whom complaints were received. The commerce ministry is also examining grievances of offline retailers and their associations against ecommerce companies. “We had held a meeting with the Enforcement Directorate as well on this matter…ecommerce companies were also asked if they were operating in an inventory and not the marketplace model,” Sitharaman said. Ecommerce portals are only allowed to operate on a business-to-business model, providing a platform for buyers and sellers.

INDO-US RELATIONS During the India-US Strategic and Commercial Dialogue, Indian industry voiced concern over the disproportionately high number of rejections of H-1B and L1 visa applications and emphasised the heavy impact of increased visa fees on Indian companies.

Nasscom has taken up the issue of increased fees for H-1B visas by $2,000 and L1 visas by $2,250 last year. “Auditing of companies, they being checked again and again gives the Indian industry an impression of being targeted and hence, they feel trust would get hit,” said Sitharaman. To boost big-ticket defence-related investment, India has suggested that the US-India Business Council facilitate the formation of a consortium of defence companies that can approach the commerce ministry without waiting for events such as the Strategic and Commercial Dialogue to voice their concerns.

Sitharaman made a similar recommendation for medical devices, considering the high potential of the pharmaceutical sector. On the government’s plan to file 16 cases against the US for violating WTO treaties, an official said the first case has been filed on the solar issue and India is awaiting a response from the US before filing the second case, which “could be any day.”